There should be a distinct differentiation between the purpose of a lifestyle portfolio, which is to invest in for your current needs, and the objective of an investment portfolio that must provide you with an income after your retirement. The latter must help you to have a roof over your head and enable you to maintain your lifestyle after retirement.
These two portfolios mostly lead to a certain extent of tension. As we know, it’s never easy for people to spend less on their families’ current lifestyle needs. As your income increases, your monthly expenses will usually also increase, despite inflation, in order to live more comfortably.
“But be careful not to buy things that you do not need with money that you do not have in order to impress people that you do not even like,” warns Hester van der Merwe, who was named the Financial Planning Institute’s (FPI) Financial Planner of the Year at the end of 2020.
Two portfolios closely intertwined
From there stems the greater emphasis that financial advisers usually place on providing for retirement. Van der Merwe points out that one’s lifestyle portfolio and your investment portfolio for retirement are closely intertwined. If people do not analyse all their objectives together with a financial planner, the chances are great that one of the two portfolios will be neglected.
“Regard and consider all aspects with a balanced eye and mind,” says Van der Merwe. “Your career and retirement; your family; all the needs and further development of other family members; your health; recreation; possible involvement in the community; and your legacy all come into play. It doesn’t help should you lose sight of one phase that’s important to you. All people’s needs differ.”
This story is from the 16 September 2021 edition of Finweek English.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber ? Sign In
This story is from the 16 September 2021 edition of Finweek English.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber? Sign In
THE HEALTH OF SA'S MEDICAL SCHEMES
As the Covid-19 pandemic abates, finweek takes a look at the financial performance of some of the largest players.
The effect of Gilbertson's departure
With Ntsimbintle Holdings now the major shareholder of Jupiter Mines, it could change SA’s manganese industry.
Making money from music
Why investors are increasingly drawn to the music industry.
Conviction is key
Sandy Rheeder plays a critical role in Mukuru’s mission to open up financial services to the emerging consumer market in Africa through tailor-made technology solutions and platforms.
The post-pandemic toolkit
How CFOs can use technology to support growth.
Big city living exodus
Mini cities like Waterfall City and Steyn City are redefining city-style apartment living.
Big compact, big value
Handsome, with a hefty level of standard specification, the roomy Haval Jolion compact crossover is a great value proposition.
On barriers to entry
There are various ways in which a company or sector can achieve competitive dominance. They usually make for good investments.
Fear and greed in one index
To buck the trend, when markets are hot or cold, is a tough thing to do. However, it can deliver solid returns.
Africa's largest data centre facility coming soon
Vantage Data Centers plans to invest over R15bn for its first African data centre facility in Attacq’s Waterfall City.
